Marcum LLP v. United States

United States Court of Appeals
for the Federal Circuit
______________________
MARCUM LLP,
Plaintiff-Appellant,
v.
UNITED STATES,
Defendant-Appellee.
______________________
2014-5001
______________________
Appeal from the United States Court of Federal
Claims in No. 13-CV-0189, Judge Marian Blank Horn.
______________________
Decided: June 13, 2014
______________________
ANDREW S. ITTLEMAN, Fuerst Ittleman David & Jo-
seph, PL, of Miami, Florida, argued for plaintiff-
appellant. With him on the brief were MITCHELL S.
FUERST and JOSEPH A. DIRUZZO, III.
JAMES SWEET, Trial Attorney, Commercial Litigation
Branch, Civil Division, United States Department of
Justice, of Washington, DC, argued for defendant-
appellee. With him on the brief were STUART F. DELERY,
Assistant Attorney General, BRYANT G. SNEE, Acting
Director, and REGINALD T. BLADES, JR., Assistant Direc-
tor.
______________________
2 MARCUM LLP v. US
Before RADER, ∗ DYK, and O’MALLEY, Circuit Judges.
RADER, Circuit Judge.
The United States Court of Federal Claims dismissed
Marcum LLP’s (Marcum) Fifth Amendment takings claim
for lack of subject matter jurisdiction. Marcum LLP v.
United States, 112 Fed. Cl. 167, 179 (Fed. Cl. 2013). The
claim seeks compensation for unpaid legal fees incurred
for work rendered as a court-appointed legal services
provider pursuant to the Criminal Justice Act (CJA).
Because the CJA provides its own remedial scheme,
Marcum cannot collaterally attack the Fifth Circuit’s
determination of Marcum’s fee awards under the Tucker
Act. Accordingly, this court affirms.
I.
This case arises from the United States’ criminal
prosecution of Allan R. Stanford. In June 2009, the Secu-
rities and Exchange Commission indicted Stanford for
operating a multi-billion dollar Ponzi scheme. J.A. 19.
After indictment, the United States seized most of his
personal and business assets rendering him an indigent
defendant.
Under the CJA, counsel for an indigent defendant
may request expert services necessary for adequate
representation. 18 U.S.C. § 3006A(e)(1). The court or
magistrate judge “shall” authorize those services upon a
finding of sufficient need. Id. Stanford’s court-appointed
counsel obtained authorization for legal services under
§ 3006A(e)(1) from the district court. J.A. 20. Stanford’s
counsel then employed Marcum for forensic accounting
and litigation support services. Id. at 19–20. Marcum
submitted an estimated budget of $4.5 million to the
∗
Randall R. Rader vacated the position of Chief
Judge on May 30, 2014.
MARCUM LLP v. US 3
district court for approval before rendering any services.
Id. at 21. The district court approved the initial budget,
but Marcum did not obtain approval from the Chief Judge
of the U.S. Court of Appeals for the Fifth Circuit. Id.
The CJA requires that expenses exceeding $2,400 be
certified by the district court and approved by the chief
judge of the regional circuit. 18 U.S.C. § 3006A(e)(3).
Marcum’s work far exceeded that amount. Consequently,
Marcum submitted monthly vouchers for work performed.
It first submitted vouchers for certification for the work it
performed in June, July, and August 2011. Marcum
received full payment for those vouchers in October 2011.
J.A. 22. Marcum then submitted vouchers for work
performed in September, October, and November 2011
totaling $845,588.48. Id. The district court, however,
certified only the September and October vouchers. Id.
By December 30, 2011, Marcum had not received payment
for any of these vouchers. Id. As a result, Marcum at-
tempted to resign from the case. Id.
On January 4, 2012, Chief Judge Edith Jones of the
Fifth Circuit issued a Service Provider Continuity and
Payment Order (the Order) for payment to Marcum. Id.
at 24. The Order authorized payment of $205,000 for the
September and October vouchers. Id. Additionally, Chief
Judge Jones ordered Marcum to continue working on the
case because “[i]t would be neither feasible nor economical
to obtain a replacement to perform the services Marcum
was expected by counsel to provide.” Id. Chief Judge
Jones also scheduled a contempt hearing for January 9,
2011 in the event Marcum did not comply with the Order.
Id. Under threat of contempt sanctions, Marcum contin-
ued to work for Stanford through the end of trial. Id. at
25. Marcum alleges that its total unpaid fees amounted
to approximately $1.2 million. Id.
During this time, Marcum challenged the Order
through various avenues of review. Marcum filed an ex
4 MARCUM LLP v. US
parte emergency motion for reconsideration before Chief
Judge Jones. Id. Marcum followed this with an emergen-
cy application for a stay before the Supreme Court of the
United States. Id. Marcum next filed an emergency
motion for a stay or, in the alternative, a petition for writ
of mandamus before the Fifth Circuit. Id. Finally, Mar-
cum petitioned the Supreme Court for a writ of manda-
mus. All of these challenges were denied. Id. at 24.
Although Marcum continued to work on Stanford’s case,
Marcum appears to have limited the subject matter of
these challenges to compensation for the September,
October, and November vouchers.
Having failed to overturn the Order through other av-
enues of review, Marcum filed a complaint for unpaid
legal fees with the Court of Federal Claims on March 13,
2013. Id. at 16. The trial court dismissed the claim for
lack of subject matter jurisdiction on August 2, 2013.
Marcum timely appealed to this court.
II.
The Court of Federal Claims is a court of limited ju-
risdiction. Terran v. Sec’y of Health & Human Servs., 195
F.3d 1302, 1309 (Fed. Cir. 1999). “[T]he United States, as
sovereign, ‘is immune from suit save as it consents to be
sued . . . and the terms of its consent to be sued in any
court define that court’s jurisdiction to entertain the
suit.’” United States v. Testan, 424 U.S. 392, 399 (1976)
(quoting United States v. Sherwood, 312 U.S. 584, 586
(1941)). Waiver of sovereign immunity must be express.
Id.The Tucker Act gives the Court of Federal Claims ju-
risdiction over claims against the United States. Testan,
424 U.S. at 397; see also 28 U.S.C. § 1491. The Tucker
Act expressly waives sovereign immunity for “any claim
against the United States founded either upon the Consti-
tution, or any Act of Congress or any regulation of an
executive department, or upon any express or implied
MARCUM LLP v. US 5
contract with the United States, or for liquidated or
unliquidated damages in cases not sounding in tort.” 28
U.S.C. § 1491(a)(1).
“The Tucker Act is displaced, however, when a law as-
sertedly imposing monetary liability on the United States
contains its own judicial remedies.” United States v.
Bormes, 133 S. Ct. 12, 18 (2012); see also St. Vincent’s
Med. Ctr. v. United States, 32 F.3d 548, 549–50 (Fed. Cir.
1994). For example, in Shearin v. United States, this
court held that the remedial scheme of the CJA preempts
Tucker Act jurisdiction over challenges to fee awards for
court-appointed attorneys. 992 F.2d 1195, 1197 (Fed. Cir.
1993). For the same reason, this court concludes that the
remedial scheme of the CJA preempts Tucker Act juris-
diction over Marcum’s claim.
III.
On appeal, Marcum argues this court’s decision in
Shearin did not address whether the CJA preempted a
Fifth Amendment takings claim and thus its claim is
distinguishable. This court, therefore, clarifies the opin-
ion in Shearin and holds that the CJA preempts a takings
claim for CJA fee award determinations brought under
the Tucker Act.
Contrary to Marcum’s assertions, the reasoning in
Shearin applies to this case. The CJA provides an explicit
procedure for court-appointed service providers to collect
compensation for their services. Under 18 U.S.C.
§ 3006A(e)(3), expenses exceeding $2,400 must be certi-
fied by the district court and approved by the chief judge
of the circuit. In Shearin, this court reasoned that “Con-
gress placed jurisdiction for review and determination of
attorney fees under the CJA within the presiding tribu-
nals.” 992 F.2d at 1197. To allow collateral review under
the Tucker Act would be to allow parties “to bypass the
system of review and recovery established by Congress.”
Id.6 MARCUM LLP v. US
This principle applies equally to Fifth Amendment
takings claims as it does to other causes of action under
the Tucker Act. If this court were to allow collateral
review of a fee award determination under the Tucker
Act, any party dissatisfied with a CJA fee award could
assert a takings claim at the Court of Federal Claims.
Such a broad reading of Tucker Act jurisdiction runs
counter to the limited scope of review for fee award de-
terminations envisioned by Congress in the CJA. See 18
U.S.C. § 3006A(e)(3); United States v. D’Andrea, 612 F.2d
1386, 1388 (7th Cir. 1980) (“[I]f a statute imposes a specif-
ic duty upon the chief judge of a circuit there is no remedy
for review of his decision as such other than an applica-
tion to the Supreme Court for mandamus.”).
This court’s holding is not altered by the fact that a
chief judge’s approval of fee awards under the CJA is an
administrative rather than judicial act. See Shearin, 992
F.2d at 1197. Many of our sister circuits have denied
appellate review of fee awards under the CJA. Those
decisions based their denial of review on recognition of the
chief judge’s approval as an administrative act. See, e.g.,
United States v. Davis, 953 F.2d 1482, 1497 n.21 (10th
Cir. 1992); United States v. Rodriguez, 833 F.2d 1536,
1538 (11th Cir. 1987); United States v. Melendez-Carrion,
811 F.2d 780, 781–82 (2d Cir. 1987); In re Baker, 693 F.2d
925, 926 (9th Cir. 1982) (“Except for the limited adminis-
trative review of the district court’s certification by the
chief judge of the circuit, the CJA makes no provision for
appeal of an order for payment of attorneys’ fees, and its
legislative history provides no suggestion that one was
intended.”); United States v. Smith, 633 F.2d 739, 741
(7th Cir. 1980) (“None of the indicia accompanying an
adversary proceeding exist.”). The CJA precludes jurisdic-
tion under the Tucker Act precisely because Congress saw
fit to curtail review by placing fee award determinations
within the discretion of the presiding tribunals. Shearin,
992 F.2d at 1197; cf. United States v. Erika, 456 U.S. 201,
MARCUM LLP v. US 7
208 (1982) (“In the context of the statute’s precisely
drawn provisions, [the omission of further review] pro-
vides persuasive evidence that Congress deliberately
intended to foreclose further review of such claims.”).
Nor does the CJA remedial scheme foreclose the due
process rights of court-appointed service providers. Those
seeking greater fee awards have the opportunity to file a
motion for reconsideration with the chief judge of the
regional circuit and petition the Supreme Court for a writ
of mandamus. D’Andrea, 612 F.2d at 1387–88. These
measures sufficiently protect the due process rights of a
party seeking increased fee awards under the CJA.
Finally, while this court is not deciding the issue, it
appears that Marcum could have avoided losses by follow-
ing proper CJA procedure. The Guidelines for the Admin-
istration of the Criminal Justice Act for the Southern
District of Texas (CJA Guidelines) instruct court-
appointed experts to seek fee approvals from the chief
judge prior to rendering services. See CJA Guidelines
§ 320.20; Instructions for CJA Form 21, available at
http://www.uscourts.gov/FormsAndFees/Forms/CJAForms
/InstructionsForCJAForm21.aspx. Marcum sought ap-
proval for compensation from Chief Judge Jones only after
performance of its services. J.A. 22. By not seeking prior
authorization, Marcum ran the risk of receiving only
partial compensation for services rendered. See Smith,
633 F.2d at 741 (“[I]t is also clear that Congress did not
intend to provide full compensation and that it contem-
plated appointments of private counsel to supplement the
efforts of professional defender organizations.”).
IV.
In sum, the CJA is a self-executing remedial scheme
for the review of fee awards. To grant jurisdiction under
the Tucker Act on Fifth Amendment takings grounds
would undermine that Act’s express intent to limit the
scope of review. For these reasons, the Court of Federal
8 MARCUM LLP v. US
Claims correctly dismissed Marcum’s claim for lack of
subject matter jurisdiction.
AFFIRMED